Every time the property market has been as weak as it is now, the government steps in with a First Home Buyers Grant/Boost. Treasury Executive minutes showed a previous FHOB "was designed to encourage people who had already been saving for a home to bring forward their purchase and prevent the collapse of the housing market": Will the government have to step in in 2019 with a FHBG and if so, should first home buyers hold off their purchase until the grant comes out to avoid missing out? How big do you think the grant will be? During the GFC, it was $7,000 for first home buyers purchasing existing homes and $14,000 for first time buyers purchasing new homes. Given the rapid increase in Sydney and Melbourne property prices since the GFC, will this still be adequate or will it need to be increased to $14k (existing homes) and $28k (new homes)?
Another factor to look at is also the state of housing construction industry , if there looking at lots of job losses sometimes they might be tempted to just pour all grants into new homes only. It creates more jobs and builders can be quite resilient at being able to trim some fat of the bone . Although it depends on what the actual aim is , either to make homes more affordable or pump up the market.
Which market are we talking about here? The RBA wanted to slow down the Sydney market as it was becoming too unaffordable so I don’t see any move to increase the FHOG for Sydney’s sake when it’s metely going through some correction. In my opinion the Sydney markets needs to correct. The WA market could probably do with a FHOG boost to increase builds/construction and therefore jobs but I don’t know if anyone cares about the Perth economy. Boosts are generally reserved for more extreme economic times.
Have heard the FHBG is a chance to move from 10k to 15k for new builds in WA next year Although with prices still dropping in WA i dont see the need really at that price point
